It's been a relatively slow summer and fall housing market for most areas of the province. That being said, prices have remained stable through the balance of 2012 (although in a lot of cases what is actually selling, rather than sitting seems to be down a lot lower than it would have been last year and there have been some VERY good buyers for buyers out there so the stats on price are a bit deceiving). So our forecast from December 2011 was half right: our survey of managers at that time predicted flat prices and a similar number of sales. We were right on the first forecast and wrong on the second.
Much of the blame for the decrease in housing sales can go to the federal government, which moved to tighten mortgage rules in June of this year. Historically, tightening of this type has led to a slower housing market for the following 3-6 month period, followed by a return to a normal market after the adjustment. That means that we expect both prices and sales to remain flat for the balance of 2012.
For those that are worried (or excited) about a drop in prices, Macdonald Realty recently had its bi-annual real estate conference where TD Bank Chief Economist Craig Alexander presented that he sees no evidence of a looming external shock on the Canadian market to justify these concerns. Interest rates and unemployment will need to rise dramatically in order to precipitate a significant fall in prices and there is no reason to believe either of those will occur in the near future. In fact, Mark Carney, the Governor of the Bank of Canada, has recently had to pull back from his threats to raise interest rates due to the fragile economic situation, while it looks as though the US economy is finally on a slow but steady recovery from the Great Recession.
To help you keep tabs on what's happening in your market, Macdonald Realty has recently introduced Housing Market Infographics that will give you a snapshot of various real estate markets throughout British Columbia. Click here to take a look!
If you would like more information, please do not hesitate to call or email me!